| A Homebuyers Service From CLHLLC |
PITI & F for Mortgagecontinued
INTEREST part of Mortgage
The Interest is the total amount of money that the mortgage costs. Some interest (such as prepaid) is paid immediately when you close. But most is paid gradually each month. The amount of the interest paid gets smaller each month, reverse of the principal.
Interest can be fixed at one rate for the whole loan period, or it can be adjusted each year. When you have an adjustable rate loan, you get lower rates (than fixed) to start off, then the rates go up above the fixed rate. So if you are keeping the home for only a few years, adjustable might be a savings for you.
The interest that you pay each month for your primary and secondary home is what IRS allows as a tax deduction. But this could be changing in the future.
TAX part of Mortgage
The Tax is the amount owed the government on your home.Taxes are usually escrowed where you pay some each month to the mortgage company, but not always. We have a mortgage where we pay the taxes ourselves.
The taxes are ‘regular’ and ‘special’. We pay only ‘regular’ taxes on our home in Naples. But our friends pay ‘regular’ and ‘special’ because they are paying for sidewalks that were built with a ‘special tax’ collected to pay for them.
The tax you pay each month for your primary and secondary home is also an IRS allowed tax deduction. But this does not seem to be changing in the future as Interest may be.
GIVE CHRIS A CALL TO DISCUSS P I T I, F & HOME MORTGAGES
AND START YOU ON THE ROAD TO HOME OWNERSHIP
YOU CANT MISS WITH CHRIS Call him today! OK?
